012018 Monthly Inflation Rate
January: Up 0.5 percent. Cause was an increase in gas prices. That offset a drop in used vehicles.
Gasoline, fuel oil, and natural gas prices drop in the spring. That's when refineries finish their maintenance and reopen for the summer driving season. Therefore, expect inflation to remain even less of a threat.
February: Up 0.5 percent. That's despite a drop in gas prices. Prices increased in energy services, especially piped gas. Prices also rose in apparel and transportation.
March: Up 0.2 percent. Gas prices fell because OPEC and U.S. shale oil producers continued to flood the market with supply. Lower gas prices offset slightly rising prices in shelter, food, and transportation. The cost of medical care services rose 0.5 percent. That's still less of an increase than before Obamacare.
April: Up 0.4 percent. High gas prices offset mild price decreases in vehicles, prescription drugs, and transportation.
May: Up 0.4 percent. Higher gas prices offset a decline in used car and truck prices.Gas prices are volatile since they're based upon commodities trading. They generally rise in the spring in anticipation of higher demand from summer vacationers.
June: Up 0.1 percent. Higher gas prices offset declines in electricity, piped gas, and apparel.
July: Zero increase. Higher used cars and truck prices were offset by lower gas and drug prices.
August: Up 0.1 percent. Higher gas prices were almost offset by a drop in apparel and drug prices.
September: Up 0.1 percent. Used car and truck sales and gas prices fell.
October: Up 0.3 percent. Prices of gas and used vehicles rose.
022017: 2.1 Percent. 1.8 Percent Core Inflation.
January: Up 0.6 percent due to a 7.8 percent increase in gas prices. That offset a 0.4 percent drop in used vehicles. Healthy inflation made it more likely the Fed would end its expansive monetary policy in the near future. The confirmation of a strong economy is good for the stock market.
February: Up 0.3 percent. Upticks in transportation services and clothing barely offset declines in gas and vehicle prices. Health care supplies fell.
March: Up 0.1 percent. Price drops in almost every category. Gas prices dropped.
April: Up 0.3 percent. Increase in gas prices offset deflation in almost every other category including health care.
May: Up 0.1 percent. Gas prices drove it, but prices also fell in cars, apparel, and medical care services.
June: Up 0.1 percent. Prices fell for almost every category. But they were offset by increases in health care, transportation services, shelter and apparel.
Many people had worried that higher interest rates would suppress the housing market. The BLS reports on rent prices as a proxy for housing prices. This means it can miss some extreme jumps in price if rentals don't keep up with housing prices. This happened in 2005, which is one reason the Fed missed that asset bubble.
July: Down 0.1 percent.. Medical care commodities rose. That was almost offset by a drop in new and used vehicle prices.
August: Up 0.3 percent. Gas prices rose.
September: Up 0.5 percent. Gas prices rose thanks to shortages caused by Hurricane Harvey.
October: Down 0.1 percent. Cause was a drop in gas prices. That helped boost Halloween sales. Low inflation allowed the FOMC to end Quantitative Easing. It announced it would no longer buy new Treasurys as its holdings expired.
November: Zero price increase. Gas prices rebounded.
December: Down 0.1 percent.
032016: 2.1 Percent. 2.2 Percent Core Inflation.
January: Up 0.2 percent. Prices fell in gasoline, home heating oil, and electricity.
February: Up 0.1 percent. Gas prices fell.
March: Up 0.4 percent. Gas prices rose while apparel prices fell as the dollar weakened.
April: Up 0.5 percent. Gas prices rose while auto prices fell.
May: Up 0.4 percent. Used car and truck prices fell while gas prices rose.
June: Up 0.3 percent. Gas prices rose.
July: Down 0.2 percent. Declines in gas prices were almost offset by mild increases in the cost of health care.
August Up 0.1 percent. Falling auto and gas prices were more than offset by rising health care costs
September: Up 0.2 percent. A huge rise in gas prices. It offset price drops in restaurants, new and used vehicles, and apparel. The cost of medical care services was flat.
October: Up 02. percent. Gas prices skyrocketed. Slightly lower prices in restaurants, used vehicles, and transportation services offset the spike.
November: Up 0.1 percent. Gasoline prices rose while medical care commodities fell.
December: 0 percent. Gas prices and transportation services rose.
Current U.S. Inflation Rate Statistics and News
Explanation and the Monthly Inflation Rate Statistics Since January 2007
The current inflation rate was 0 percent in November, according to the . Falling gas prices offset increases in other categories.
The prices of used cars and trucks rose 2.4 percent.
In the last 12 months, the cost of health care services rose 2.4 percent. Drug prices rose 0.6 percent during that time. Health care costs have risen more slowly since Obamacare took effect in 2014. Before that, prices rose 7 to 8 percent a year.
Current Core Inflation Rate
The core inflation rate was 2.2 percent year over year. The core rate eliminates the impact of oil and food prices. High oil prices will increase the prices of fertilizer and transportation costs. That will create high food prices.
The core rate was slightly above the Federal Reserve's 2.0 percent inflation target. That makes it likely the Federal Open Market Committee will continue raising the fed funds rate in 2018 and 2019. The Fed last raised the rate to 2.25 percent at its September 26, 2018, FOMC meeting.
In January 2012, the Fed switched to the Personal Consumption Expenditures. The Fed considers it to be more reflective of true underlying inflation trends. Its core inflation rate was 2.0 percent YOY as of September 2018. That's from the most recent release from the report.
How the Current Inflation Rate Affects You
Moderate inflation is actually good for economic growth. When consumers expect prices to rise, they are more likely to buy now, rather than wait. This increases demand. That's because inflation is usually driven by expectations of inflation, as pointed out by former Fed Chair Ben Bernanke. This means that, if people and investors think prices will go up, they will buy things now, increasing demand and actually driving the prices further up. In other words, inflation is a self-fulfilling prophecy.
The Federal Open Market Committee reviews the core inflation rate when it decides at its eight FOMC meetings whether to raise the fed funds rate. The core rate removes the volatile effects of gas, food and oil prices. The Federal Reserve sets a target rate of 2 percent for the core rate. When the rate is lower than the target, the Fed may use expansionary monetary policy, and lower interest rates to increase it, and ward off deflation and possible recession.
When the rate is higher than the 2 percent target, it uses contractionary monetary policy, and raise rates to keep prices from rising faster than your paycheck. Some critics worry that higher interest rates would weaken consumer demand. That would slow economic growth, reducing its ability to create jobs.
Some people worry that inflation will skyrocket, causing hyperinflation. They are concerned that prices increases could be like that seen during the Weimar Republic in Germany. When that happens, goldbugs can cause a rally in the precious metal as a hedge. But to have hyperinflation, prices must rise 50 percent a month.